nigel davis/london
RIDING THE rollercoaster of soaring
The ICIS Top 100 Chemical Companies
saw the good times roll in 2007,
but 2008 brings a more challenging
environment, testing their mettle
18  ICIS Chemical Business  |  September 15-21, 2008  |  www.icis.com
energy and commodity prices, global chemi-
cal industry players performed remarkably
well in 2007. Most of the sector continued
to bask in good times, with demand growth
still high, but the US downturn began to
bite, and, for some, life was harder.
In this issue, ICIS Chemical Business casts
a sharp eye over the financial performance
of the leading players in the industry
– from the broad-based to the focused
makers of chemicals, fertilizers and indus-
trial gases.
The ICIS Top 100 Chemical Companies
includes all chemical firms with annual sales
greater than $2.5bn (€1.8bn). It charts the
fortunes of a geographically diverse group of
players that supply vitally important materi-
als to the world’s growing industries.
The ICIS Top 100 analysis captures a
broad set of financial data for the world’s
leading chemical companies.
A total of 18 financial metrics are col-
lected from the companies themselves, from
annual reports and other sources. An array
of ratios is generated from this data. The
analysis looks at the 100 leading companies
by sales, but data are also collected for
smaller players to facilitate regional analyses.
We gather corporate, rather than divi-
sional data for most firms to help with a
broader ratio analysis. But for the major oil
and energy producers, we look at the chemi-
cal operations only.
In 2007, the sector benefited from con-
tinued strong demand growth, particularly
from the fast-developing economies in Asia,
most notably China. Chemical demand from
Central and Eastern Europe and from Latin
America was also robust.
Much has been written about the impact
on the sector of the sharp economic slow-
down in the US, and in North America as
a whole. The sharp downturn in the vitally
important US home construction and auto
sectors hit the industry hard, and continues
to do so.
But the impact, largely in the second half
of the year, was masked, to a great extent, by
product and geographical diversity.
The analysis demonstrates clearly that the
world’s major chemical producers continued
to grow strongly in 2007. It is not so read-
ily apparent, however, that the momentum
behind that growth has weakened.
Companies captured volume increases
alongside all-important price gains. Shifting
currency exchange rates also had an impact
on the reported results, particularly the
weakening of the US dollar and the strength-
ening of the euro.
The ICIS Top 100 table shows company
results in US dollars, with year-on-year com-
parisons made in local currencies. Financial
year-end exchange rates are used throughout.
Given the significant weakening of the US
SABIC acquired US-based GE Plastics
later in the year, while Givaudan had earlier
acquired Quest, the UK-based ICI’s fra-
grances business.
It was, however, volume and, to a greater
extent, price that drove the top line of most
firms over the course of the year.
Chemical demand globally continued to
be strong in 2007. And although growth
stronger cash flows down to the bottom line.
Dividend payouts increased and more firms
used excess cash to pay down debt and/or to
accelerate share buybacks.
The year was one in which more compa-
nies had more room to maneuver and were
able not so much to flex financial muscle in
terms of acquisitions, but to be astute in terms
of growth, investment, and regard for share-

dollar in 2007, however, for the first time,
this year, sales changes are given in the table
in local currencies.
The average increase in sales in the diverse
chemical sector was 10.8% in 2007 in local
currency terms and 18.1% when converted
back to US dollars.
The most impressive gains were made
by the fertilizer and agrochemical majors,
as might be expected, given the significant
run-up in food and fertilizer prices over the
course of the year.
Those commodity price increases colored
the analysis for 2007 and underpin the main
features of the industry performance analy-
sis to be published in the September 29 issue
of ICIS Chemical Business.
The world’s largest processed phosphate
fertilizer producer, US-based Mosaic,
reported one of the strongest year-on-year
sales increases for its financial year ended on
May 31, 2008. The company’s results overall
demonstrated the fact that the fertilizer
upturn continued strongly into 2008.
Norway’s Yara, Saudi Arabia’s SABIC, and
Switzerland’s Givaudan were among the
companies to have grown most strongly in
2007, the latter two boosted by acquisitions.
“
Volume and, to a greater
extent, price… drove the
top line of most firms
slowed markedly in the US later in the year,
demand remained buoyant in Europe and
especially strong in the BRIC (Brazil, Russia,
India and China) nations. The year was col-
ored by the sharply rising cost of oil.
Oil-based feedstock costs rose sharply, as
did the burden of energy costs on all play-
ers. Companies were quick to pass on these
higher costs, particularly those operating at
the top of the chain and closest to fast-  low-cost gas-based feedstocks.
rising and volatile feedstock naphtha.
Natural gas prices also climbed throughout
the year, putting a burden on producers of
olefins and other materials.
The momentum gained in the industry
in recent years was also widely apparent in
2007 profit performance. Operating profits
in the sector climbed by more than 12%. Net
profits significantly improved.
Many companies were able to push
holders. Despite the still good times, players
continued to focus on efficiencies in 2007,
illustrating the more cautious mind set of
management. As costs rose, they were mind-
ful of the prospects of an industry downturn.
Mountain of new capacity
The upstream petrochemical business and
commodity polymer makers expect soon to
face the consequences of a mountain of new
production capacity due on stream in the
Middle East and in Asia.
The center of gravity of this end of the
business, as well as many more specialized
chemical segments, is shifting eastward as
chemical demand growth patterns change,
and as new producers tap into sources of
The emergence of lower-cost capacities, in
particular, will affect the performance of all
olefins and polyolefins players. Less efficient
facilities will be hard pressed to make money
as sector operating rates are lowered. They
are also likely to be saddled with high and
volatile feedstock and energy costs.
The petrochemical firms were exposed in
2008 and particularly in the second quarter,
as oil prices topped $147/bbl. ❯❯

Where are they now?

Just how much has the chemical industry changed over the past five years? The answer is a great
top 10 in 2002 deal, and there is likely to be more to come. The industry Top 10 has been shape-shifted by sector
restructuring and the emergence of new players. Producers from the Middle East, China and India have
Company Sales
become more important and certainly bigger in a global sense.
$m % change
The chemical industry was in a very different place in 2002. Companies started the year on
BASF 33,778 -0.9 something of a high note, but were soon mired in difficulties.
Bayer 31,061 -2.2 This quotation from our Top 100 report at the time is apposite: “If 2002 demonstrated anything,
Dow Chemical 27,434 -1.3 it showed that many companies would have to continue to do a great deal in terms of cost control and
DuPont 24,006 -2.9 restructuring to squeeze more from less. As the year progressed, it rapidly became clear that earlier
Atofina 20,626 -1.5 economic growth and manufacturing industry optimism were not sufficient to carry the day.”
ExxonMobil 20,310 5.2
The year 2007 was markedly different, and the past few years have demonstrated just what
chemical companies can do in terms of performance. Yet, as further features in our Top 100 analysis

2002 to now
Akzo Nobel 14,681 -0.8
series will show, times continue to change – and fast.
Mitsubishi Chemical 14,224 6.0
The rapid and unprecedented run-up in the price of oil has hit the sector hard. The credit crunch
a look back
BP
Degussa
12,507
12,336
10.9
-0.8
and US economic downturn are having a global knock-on effect. There are great uncertainties for
players in chemicals that are exposed to strong global forces. In 2008, companies are challenged to
SOURCE: ICIS continue to perform in trying and, once again, difficult times.

www.icis.com  |  September 15-21, 2008  |  ICIS Chemical Business  19

THE ICIS TOP 100

THE ICIS TOP 100

Sales Operating profit Net profit Total assets R&D Capital spending Employees
Company $m % change $m % change $m % change $m % change $m % change $m % change Number % change
local currency $
1 BASF 85,353 10.2 22.9 10,775 20.9 5,987 41.1 68,932 15.3 2,033 20.3 6,517 -50.8 95,175 -0.1
2 Dow Chemical 53,513 8.9 8.9 4,229 -14.9 2,887 -22.5 48,801 7.1 1,305 12.1 2,075 16.9 45,856 7.7
3 ExxonMobil b 53,417 9.1 9.1 5,546 -3.3 4,563 4.1 21,418 9.6 273 8.3 1,782 135.7 12,965 0.2
4 Shell b 45,911 12.7 12.7 2,447 106.8 2,051 92.8 20,310 14.9 – – 1,419 61.8 8,500 0.0
5 LyondellBasell Industries c 44,735 n/a 24.0 1,826 -3.2 168 -69.5 – – – – – – 16,000 -9.1
6 INEOS 40,527 3.5 15.5 1,783 46.5 488 221.1 14,153 8.9 127 22.7 – – 16,600 10.7
7 SABIC 33,724 46.2 46.5 10,968 33.2 7,221 33.4 68,474 54.1 – – – – 31,000 63.2
8 Sinopec b 32,999 12.0 19.7 – – – – 16,655 17.6 – – 2,219 37.0 70,712 -8.4
9 Mitsubishi Chemical d 29,532 11.7 34.0 1,260 16.7 1,654 96.2 27,880 43.1 1,130 47.5 1,714 55.9 39,305 17.5
10 DuPont 29,378 7.1 7.1 3,743 12.4 2,988 -5.1 34,131 7.4 1,338 2.8 1,585 3.5 60,000 1.7
11 Total b 29,170 3.6 15.6 1,701 6.0 1,248 6.9 – – – – – – 45,810 2.5
12 Bayer e 25,890 2.0 13.8 2,342 22.4 – – 35,580 5.0 1,293 12.5 1,912 24.5 54,700 0.2
13 AkzoNobelc 21,271 – – 1,361 – 1,172 – 37,192 – – – – – 42,600 –
14 Evonik f 21,253 2.2 14.0 1,367 76.7 1,290 -6.6 29,162 5.4 452 13.0 1,520 23.1 43,057 -7.3
15 Yara International 19,420 52.0 52.0 – – – – – – – – – – 8,173 15.8
16 Sumitomo Chemical d 19,117 6.0 27.1 1,032 -12.0 636 -19.4 23,778 21.7 1,062 29.4 1,437 7.0 25,588 3.6
17 Mitsui Chemicals d 18,010 5.8 27.0 778 1.0 250 -43.1 14,810 17.7 424 36.9 854 39.8 12,814 2.4
18 Linde g 17,614 15.2 28.5 3,762 29.1 – – – – 143 17.6 1,632 47.3 45,214 2.0
19 ChemChina (CNCC) q 17,400 69.6 69.6 – – – – – – – – – – 100,000 0.0
20 Air Liquide 17,381 7.8 20.2 2,648 63.9 1,654 25.0 26,941 25.2 – – – – 40,000 8.4
21 Asahi Kasei d 17,104 4.5 25.4 1,287 19.8 705 22.4 14,368 17.1 566 28.5 836 17.8 23,854 0.6
22 Toray d 16,629 6.7 28.0 1,043 21.1 485 -1.5 17,118 21.7 – – 1,495 47.7 38,565 5.5
23 Johnson Matthey d 14,961 21.9 24.1 586 18.7 – – 5,199 27.0 – – – – 7,800 11.4
24 Shin-Etsu d 13,874 5.5 26.6 2,894 42.9 1,850 43.0 19,339 23.7 483 37.8 2,706 52.9 20,241 5.5
25 Reliance Industries d/j 13,210 14.0 14.0 1,773 17.2 – – – – – – 126 18.9 – –
26 DSM 12,898 4.8 17.0 1,212 10.0 632 -12.5 14,475 8.6 548 19.6 700 16.0 23,254 5.0
27 Chevron Phillips Chemical 12,534 5.9 5.9 820 -43.2 719 -46.7 7,232 1.6 42 5.0 314 64.4 5,000 -2.9
28 LG Chem 11,551 16.3 14.1 817 122.7 734 113.0 7,543 19.1 – – – – 10,000 0.0
29 BP 11,000 – – – – – – – – – – – – – –
30 DIC (was Dainippon Inks & Chemicals) d 10,865 6.1 26.1 488 11.9 313 64.2 9,861 17.2 – – – – 25,167 -1.8
31 Braskem 10,646 11.0 33.8 854 132.5 321 485.3 – – – – – – 5,000 0.0
32 Merck KGaA 10,394 12.3 25.3 1,438 -1.5 – – 21,978 105.5 1,514 86.5 417 24.8 30,968 21.3
33 Solvay e 10,282 2.7 14.6 1,233 42.8 – – – – 208 13.2 1,037 19.5 19,162 0.0
34 Polimeri Europaj 10,213 1.6 13.4 298 31.0 334 45.5 – – – – 214 63.4 6,534 8.4
35 PPG Industries k 10,177 13.6 13.6 1,266 1.5 – – – – 354 10.3 – – 24,900 -9.5
36 Air Products o 10,038 14.7 14.7 1,408 33.3 1,036 43.3 12,660 13.2 140 -7.3 – – 22,100 6.8
37 Mosaic l 9,813 70.0 70.0 2,807 356 2,083 396 10,118 15 – – – – 7,000 -13
38 LANXESS 9,733 -4.8 6.2 317 -36.2 165 -36.6 5,964 7.4 128 10.3 418 18.7 14,610 -11.4
39 Sekisui Chemical d 9,664 3.5 24.2 434 14.3 245 14.2 7,892 6.8 258 25.4 316 3.4 18,907 0.0
40 Huntsman 9,651 10.5 10.5 536 -16.9 -172 n/a – – 145 26.1 665 20.9 13,000 -7.1
41 Praxair 9,402 13.0 13.0 1,786 17.6 1,177 19.1 13,382 20.5 98 12.6 1,376 25.1 27,992 3.5
42 Borealis 9,353 10.6 23.4 664 42.5 362 -16.2 6,821 40.7 72 21.5 673 117.9 5,060 10.0
43 Syngenta 9,240 14.8 14.8 1,464 76.6 1,109 74.9 13,280 12.1 830 4.3 317 46.1 21,200 8.7
44 Rohm and Haas 8,897 8.1 8.1 2,467 -0.6 661 -10.1 10,208 6.9 296 3.5 417 3.2 15,710 -0.7
45 NPC (Iran) d 8,388 69.8 69.8 1,184 71.6 235 -15.0 27,624 29.4 36 9.1 2,255 27.2 18,079 6.4
46 Arkema 8,358 0.2 11.8 326 128.3 183 194.3 6,534 10.1 233 4.9 479 7.9 15,200 -10.6
47 Tosoh d 8,340 5.9 27.0 596 17.6 254 6.1 8,235 24.3 – – 733 957.3 11,088 5.5
48 Sherwin-Williams 8,005 2.5 2.5 – – 616 6.9 4,855 -2.8 37 0.0 166 -21.0 31,572 2.6
49 SK Energy j 7,938 35.3 32.7 543 10.7 – – – – – – 171 -24.3 – –
50 Clariant 7,581 5.3 14.1 479 -1.4 4 -106.9 6,472 9.7 187 10.4 277 -5.6 20,931 -3.8

20  ICIS Chemical Business  |  September 15-21, 2008  |  www.icis.com

THE ICIS TOP 100 continued
Sales Operating profit Net profit Total assets R&D Capital spending Employees
Company $m % change $m % change $m % change $m % change $m % change $m % change Number % change
local currency $
51 Rhodia 7,484 5.6 17.8 660 39.2 193 121.4 6,595 -3.1 141 4.0 477 16.2 15,500 -3.1
52 Formosa Chemicals & Fibre n 7,398 n/a 32.5 – – 1,558 48.5 11,554 26.2 – – – – 5,620 -3.6
53 Repsol YPF j 7,255 3.1 15.0 340 -27.0 – – – – – – – – 3,258 1.4
54 Eastman Chemical 6,830 0.8 0.8 504 -22.9 300 -26.7 6,009 -2.0 156 0.6 518 33.2 10,800 -1.8
55 PKN Orlen b/j 6,741 1.2 20.4 537 46.6 – – – – – – 261 54.1 – –
56 NOVA Chemicals 6,732 3.3 3.3 553 n/a 347 n/a 4,836 18.6 50 -2.0 156 -21.2 2,820 -14.5
57 Sasol h/p 6,708 19.2 34.7 282 n/a – – – – – – – – 6,848 -11.1
58 Celanese 6,444 11.5 11.5 748 20.6 426 4.9 8,058 2.1 73 12.3 288 18.0 8,400 -5.6
59 Hexion 5,810 11.6 11.6 302 5.6 -65 -31.6 4,006 14.2 70 1.4 122 0.0 6,400 -7.2
60 Ciba 5,795 2.7 11.2 386 1.7 211 n/a 7,807 4.8 233 5.1 238 23.0 13,319 -5.7
61 Formosa Plastics n 5,598 n/a 23.7 – – 1,562 58.6 10,479 19.9 – – – – 4,927 0.4
62 Wacker-Chemie 5,569 13.3 26.4 959 58.6 622 51.4 5,771 34.2 225 11.9 1,030 48.5 15,044 2.6
63 Pemex j 5,296 92.5 90.6 -1,204 n/a -1,356 -24.5 – – – – – – – –
64 Agrium 5,270 25.7 25.7 715 893 441 1236 5,839 78.8 – – 454 117.2 6,618 1.0
65 Mitsubishi Gas Chemical d 5,235 7.6 29.1 477 34.6 405 20.5 6,062 18.3 – – – – 2,151 -0.4
66 Potash Corp. of Saskatchewan 5,234 38.9 38.9 – – 988 56.3 9,717 56.3 – – 607 19.3 5,003 2.7
67 Cognis 5,181 4.3 16.4 272 0.2 -177 n/a 3,689 5.9 134 8.0 194 47.3 7,585 -1.7
68 Kaneka d 5,070 6.3 27.5 360 17.0 190 22.9 4,562 16.3 – – 318 6.5 7,498 0.9
69 Dow Corning 4,943 12.5 12.5 – – 690 3.3 7,199 20.5 – – – – 10,000 11.1
70 K+S 4,925 13.1 26.1 -157 n/a -137 n/a 4,367 16.8 23 23.5 253 47.0 12,033 1.3
71 Orica o 4,910 3.1 22.7 722 47.0 434 7.7 5,511 29.2 28 13.5 – – 14,174 5.3
72 Honeywell r 4,866 5.1 5.1 – – 658 15.8 – – – – 215 15.6 – –
73 Sibur j 4,846 11.8 20.1 1,282 15.7 – – – – – – 267 28.8 – –
74 Occidental Chemical b 4,664 -3.1 -3.1 – – 601 -33.7 3,814 0.3 – – – – 3,100 -1.9
75 Lubrizol 4,499 11.3 11.3 283 57.6 283 172.1 4,644 5.8 219 6.6 183 39.6 6,921 2.6
76 Cementhai Chemicals 4,374 6.2 27.1 462 -6.2 570 15.7 4,139 34.9 – – – – – –
77 Showa Denko s 4,275 15.7 22.7 241 33.3 – – 3,391 5.3 – – 95 -24.8 2,078 -8.6
78 Kemira 4,139 11.4 24.3 211 -17.8 99 -32.8 4,165 13.9 97 44.4 473 -22.5 10,007 7.3
79 JSR d 4,102 11.2 33.5 605 30.3 373 31.9 4,203 22.3 – – – – 5,122 9.1
80 Israel Chemical 4,100 25.8 25.8 715 33.4 536 43.3 4,633 28.4 39 11.4 195 35.4 9,914 6.5
81 ALPEK (Grupo Alfa) 4,007 17.5 17.5 177 -25.6 80 -51.5 3,057 18.6 – – 182 -42.4 4,166 3.5
82 Ashland t/o 3,923 17.6 17.6 191 81.9 – – – – 50 4.2 125 -10.1 – –
83 Nalco 3,913 8.6 8.6 207 24.4 129 30.3 5,979 5.7 – – 115 23.7 11,500 3.6
84 Petronas j 3,844 14.4 14.4 – – – – – – – – 246 95.2 – –
85 Chemtura 3,747 8.4 8.4 59 1080 3 n/a 4,416 0.4 62 1.6 117 -8.6 5,144 -17.0
86 Kuraray d/s 3,720 8.4 14.9 429 26.9 2 -98.9 4,369 2.2 – – 380 20.1 6,770 -0.6
87 Givaudan 3,671 42.0 53.8 – – 84 -75.3 7,016 81.9 – – – – 8,776 44.9
88 RPM l 3,644 9.1 9.1 – – 48 -76.9 3,764 12.9 – – 72 2.9 9,400 0.0
89 Tessenderlo Group 3,544 7.5 19.9 224 135.5 190 n/a 2,479 10.1 40 7.6 145 -7.6 8,121 -0.0
90 Quattor Participacoes c 3,536 n/a n/a – – 282 n/a – – – – – – – –
91 Solutia 3,535 26.5 26.5 190 118.4 -208 n/a 2,640 28.2 37 0.0 150 42.9 6,000 17.6
92 Cytec Industries 3,504 5.2 5.2 324 6.2 192 14.3 4,062 6.0 76 2.7 115 12.0 6,800 1.5
93 Ube d 3,293 9.4 31.2 330 55.7 – – – – – – – – 11,058 2.1
94 Valspar u 3,249 9.1 9.1 310 0.8 172 -1.7 3,452 8.2 90 8.4 9,946 4.1
95 Asahi Glass b 3,219 3.8 24.6 126 90.4 – – 2,857 16.7 – – 262 20.4 4,857 0.5
96 Westlake Chemical 3,192 28.5 28.5 271 -31.6 115 -40.9 2,569 23.4 7 16.3 136 0.0 2,120 3.1
97 W.R. Grace 3,115 10.2 10.2 – – 80 338.8 3,869 6.4 80 21.2 137 15.1 6,500 -1.5
98 Denki Kagaku Kogyo (Denka) 2,933 6.9 13.4 266 21.5 140 8.6 3,653 4.5 – – – – 4,696 -0.9
99 IRPC j/m 2,822 17.1 40.2 – – 173 36.4 1,182 25.8 – – – – – –
100 Hanwha Chemical 2,659 12.0 9.9 179 43.4 228 1.9 3,884 16.8 27 35.9 – – 1,875 1.1

www.icis.com  |  September 15-21, 2008  |  ICIS Chemical Business  21

 THE ICIS TOP 100

THE ICIS TOP 100 – bubbling under

Sales Operating profit Net profit Total assets R&D Capital spending Employees
Company $m % change $m % change $m % change $m % change $m % change $m % change Number % change
local currency $
101 PolyOne 2,643 0.8 0.8 34 -82.2 11 -91.1 1,583 -11.1 22 10.0 43 4.9 4,800 2.8
102 FMC 2,633 12.2 12.2 228 -9.1 132 0.8 2,733 -0.3 95 -2.1 115 -0.9 5,000 0.0
103 Cabot o 2,616 2.9 2.9 187 48.4 129 46.6 2,636 4.0 69 19.0 141 -25.0 4,300 0.0
104 PTT Chemical (PTTCH) 2,590 4.5 25.1 773 20.2 644 25.5 4,485 43.4 – – – – 2,451 2.7
105 Lonza 2,550 -1.5 6.6 363 28.4 267 46.8 4,398 37.0 79 26.8 – – 7,711 25.5
106 Momentive Performance Materials 2,500 3.6 3.6 82 -18.7 -254 586.5 – – 79 -1.8 – – 5,000 0.0
107 Honam Petrochemical 2,413 3.4 1.4 – – – – – – – – – – – –
108 Albemarle 2,336 -1.4 -1.4 – – 233 15.9 2,831 11.9 63 37.0 – – 4,100 17.1
109 IFF 2,277 8.7 8.7 – – 247 9.1 2,727 10.0 199 7.0 – – 5,315 4.5
110 Hercules 2,136 5.0 5.0 264 6.0 179 -25.1 2,678 -4.6 44 12.8 108 14.9 4,661 5.2
111 Mexichem j 2,115 121 119 399 72.6 169 53.2 – – – – – – – –
112 Compania Espanola de Petroleos 2,105 -6.5 4.3 – – – – – – – – – – 9,000 0.0
FOOTNOTES to tables f Evonik was formerly known as Degussa Companies excluded and reason
a Key financial year-end exchange rates used for 2007 data g Linde gas & engineering figures only. Prior year 2006 figures Koch Does not segment chemical data
(2006 in parentheses): $/€ 1.473 (1.32), Yen/$ 99.2 (119.0), include 12 months of BOC OMV Includes petrochemical operations in its refining and market-
$/£ 1.995 (1.959) h Financial year end June 30, 2007 ing segment
b Chemical segment figures only. Includes intersegment rev- i Estimated figures, as BP does not segment chemical data Shanghai Petrochemical Majority owned by Sinopec
enues, e.g. revenue for sales to other divisions of by-products. j Petrochemical figures only Samsung Total Petrochemicals $4bn sales equity accounted in
For ExxonMobil, intersegment revenue was $16.591bn in k PPG Industries includes performance, industrial, commodity Total and Samsung figures
2007 and $14.846bn in 2006. Sinopec = external sales and glass segment figures (does not include optical figures) China Bluestar Chem Majority owned by ChemChina
with intersegment sales. Total restated figures to exclude the l Financial year end May 31, 2008 Formosa Plastic Corp. USA Not segmented in Formosa reports
contribution from Arkema m IRPC was formerly known as Thai Petrochemical Formosa Petrochemical Corp. Does not segment chemicals
c Pro forma results for 2007. Lyondell and Basell completed a n Net profit is pretax from refining business
$19.4bn (€13.6bn) merger. 2006 figures based on the sum of o Financial year end September 30, 2007 Nan Ya Plastics Sales are for both chemicals and processed items
Lyondell and Basell. AkzoNobel = pro forma results. AkzoNobel ac- p Sasol turnover figures from polymers, solvents, olefins and Yeochon NCC Results included with Hanwha and Daelim
quired ICI in January 2008. Quattor Participacoes = a joint venture surfactants added together Daelim Below top 100 in sales as Yeochon NCC accounted as
between Unipar and Petrobras launched on June 12, 2008. q Estimated as data not published by ChemChina equity company
d F inancial year end March 31, 2008 r Specialty materials figures used Samsung Does not consolidate various chemical company interests
e Bayer data excludes HealthCare division, with 2007 sales of s Petrochemical and chemical segment figures used into one area
€14.8bn. Solvay data excludes pharmaceutical business, with t Ashland excludes distribution business PTT Group Results included as IRPC and PTTCH businesses
€2.6bn sales in 2007 u Valspar financial year end October 31, 2007

❯❯ In 2008, global GDP forecasts and   was 5.5%. Operating margins increased
subsequently chemical sector forecasts were
also lowered. The industry has come off   firm Chemtura and fertilizer producers
its plateau of earnings performance and is
facing an increasingly tough global operat-
ing environment.
First-half 2008 performance has held up
relatively well, particularly for the more spe-
cialized players and those not overly exposed
to the US. The second-half outlook, however,
is not strong,
efficiency drives gains
In 2007, sales per employee in the industry
improved by more than 9%, reflecting sales
growth but also the focus of many firms on
employee costs. Selling, general and admin-
istrative costs for the group of companies
for which the data were available increased
only slightly.
The drive to greater efficiencies was
reflected in the overall improvement in
profits ratios. Net returns in 2007 in the Top
100 improved by 11%. Operating profit data
were available for fewer companies on the
list but the average operating return increase
markedly for US-based specialty chemical
Agrium in Canada, as well as Mosaic in the
US. French chemical giant Arkema’s operat-
ing return more than doubled.
M&A and the Credit crunch
Mergers and acquisitions (M&A) reached a
peak in 2007 in value terms, if not in total
number of deals. The credit crunch took its
toll, but chemical deals have continued.
Some of the largest in recent history took
place in 2007, including the SABIC/GE
Plastics deal, and the merger between
Netherlands-based Basell and US-based
Lyondell Chemical. Other focused acquisi-
tions reinforced the strength of companies
such as UK chemical firm INEOS.
The year 2007 was one of consolida-
tion for the sector. M&A has been less
pronounced in 2008 but the industry is still
enlivened by the moves of major players
such as US-based Dow Chemical to focus
on value-added specialty areas of business
and move away from commodities.
The top players in chemicals are focused
on lifting value added by operating more
efficiently and delivering greater value to
customers. The commodity players do that
by maintaining plant efficiencies and logis-
tics networks. The specialty chemical com-
panies work more closely with customers.
The analysis also looks at capital expen-
ditures and researach and development
(R&D) spending. Not surprisingly, capital
spending was higher in 2007 than in 2006,
as profitability improved.
Research spending varied greatly in the
sector, with R&D/sales ratios of between
0.5% and close to 9%.
The increase in spending in 2007 by
some of the biggest companies in the
industry is noteworthy as greater emphasis
was placed on organic growth in changing
industry times. ■
❯❯ The ICIS Top 100 table is based upon the
ICIS annual analysis of the performance of the
world’s leading chemical companies. Further
details of this analysis are available from Lara
Mcnamee: lara.mcnamee@icis.com

22  ICIS Chemical Business  |  September 15-21, 2008  |  www.icis.com